Telematics and CRM: A Turnkey Solution for Usage Based Insurance
There is no denying that the insurance industry as a whole is warming up to the idea of usage based insurance products. Many insurers like Progressive, The Hartford and Travelers have already launched usage based products and are collecting extremely valuable customer data in the process. Recent survey results from InsuranceQuotes.com also suggest that drivers are also warming up to the idea: 43% of US drivers between the ages of 18-29 years indicated that they would consider enrolling in a pay-as-you-drive program. Clearly there is a correlation between the comfort level with technology among the 18-29 year olds and their willingness to share their driving data. As a larger percentage of our population becomes more comfortable with technology and data privacy concerns the market for usage based insurance products will continue to grow and insurers that wish to compete in this space must have something to offer.
So what does all this have to do with a Customer Relationship Management (CRM) system? Telematics systems capture data, CRM systems put the data to work. CRM systems are built to capture, aggregate and organize data and to make that data actionable. For example, if the driving behavior that is captured through a telematics system is aggregated into a CRM system the insurer can better segment their customers into ideal product profiles and then market to them with a more targeted message for a product that best meets the needs of their drivers. Or conversely, the data may help the insurer identify which current customers are of higher risk and shouldn’t be pursued in future marketing efforts.
Microsoft Dynamics CRM allows for the creation of dynamics marketing lists which are used to maintain groupings of customers based on pre-defined criteria. A couple of examples of dynamic marketing lists that insurers might maintain in a CRM solution are:
- all current customers between 18-29 years of age with poor aggressive braking scores
- all current customers who drive more than 50% of their average monthly miles during rush hour traffic and are in a metropolitan area
With this type of data in a CRM solution insurers are not only more effective at calculating risk and segmenting their customers accordingly, but they also have the tools to create and execute targeted marketing campaigns to reach the right customers with the right message and product offering. If marketing lists are well-defined very little human intervention is required to automatically capture and group all customers with similar characteristics and to send them an automated email letting informing them of a new product offering that is likely to be enticing because the right message is being delivered, at the right time, to the right customers.
Hitachi Solutions, an industry leading Global Systems Integrator of Microsoft Dynamics CRM has established a formal partnership with Baseline Telematics to deliver turnkey telematics and CRM solutions for the auto, fleet, home, health and life insurance providers. You can read more about the Hitachi Solutions and Baseline Telematics partnership in our recent Press Release.